Premium Sports and Movies - Ofcom's remedies

Long overdue - the sports rights market has been distorted by Sky for years and in the long term a correction in it would be good for all, whilst hopefully it gives ESPN more of a fighting chance than Setanta and ITV Sport ever had. The usual bodies moaning about it of course, but only those who've sold out to Sky or are clearly getting paid much more than their product is worth need to worry really.


It all comes back to the classic conflict of interests of Sky being platform provider and channel supplier, something which should have been addressed years ago. With Sky Sports especially I'd like to know whether or not it's entirely self funding, or whether those subscribing to Sky without the sport packages are also adding to the pot of money used for Sky Sports.

Also we don't here about it so much these days but how expensive are movie rights in comparison to sport. Considering Sky have zero competition in the premium movie channel sector, surely they can't be paying anywhere near as much for them as they are for their sports rights.

I'm sure you'll all have much more sympathy for Sky's concerns wit the news that OFCOM's proposals could hit some of footballers highest paid stars in the pocket.

http://www.guardian.co.uk/media/2010/mar/31/sky-premier-league-ofcom

Nope, they're a bunch of overpaid pansies anyway.

http://www.guardian.co.uk/media/2010/apr/14/bskyb-darroch-ofcom

"BSkyB chief says smaller channels will suffer from Ofcom pay TV ruling"

So reading between the lines it appears to me he's basically just saying Sky will abuse it's position and syphon off more cash from it's regular subscribers to fund the sport and movie channels at the expense of the general channels.

Considering OFCOM only want Sky to sell their sports channels at a wholesale price of £10.63 a month to other providers, yet only charge a retail price of £9 a month to their own customers (on top of the basic subscription), they're getting off rather lightly IMO. Perhaps if their own pricing policy reflected the true cost of the sports channels in the first place OFCOM wouldn't be intervening in the first place.

I hope BskyB's appeal is accepted and Ofcom's stupid decision is scrapped.

Sky have bidded for these rights in an open market, BT and Virgin had every opportunity to bid for the rights but didn't bother, how can BskyB be blamed for that!

Simply because BSB has become too powerful, Setanta's collapse demonstrated this.

New entrants have an impossible task considering that the sheer market presence of BSB enables them to get finance on cheaper terms than a newcomer can hope for (Setanta again). The risk for rights holders element increases the newcomer's costs too.

The alternative being that they reach a benevolent arrangement with BSB to retail their services (ESPN)

Monopolistic structures are poor, I was at one stage hoping for the enforced split of programme provider and platform, unfortunately that's not happened. BSB have escaped lightly, very lightly in my view.

I would say Darroch is just saying what logically could happen. If people can go to other platforms and buy the sports channels on a stand-alone basis, for less than they can from Sky, then many (who only subscribe for the football etc.) will leave. Fewer basic subscriptions, will mean less subscription income for the third party companies and fewer viewers, less ad revenue..

Doesn't that show part of the unfairness of Sky's system? People who only want to watch the football are forced to subsidise crappo tv and we can't possibly let crappo tv go bust. Like they care. They only like their high number of channels because it makes them look "better" than Virgin who aren't forced to give EPG slots to shi+e channels.

Agreed 100% with Hyma, there might be a case for loss leaders in supermarkets but each subscription channel in broadcasting should be accounted for independently. Cross subsidy imvokes even more unfairness and distortion into the market. Should BSB's commercial model be framed on unfairness and distortion? of course not.

Sky are pretty much screwed either way with that then. If they bundle as they do now it's unfair, but if they did let viewers pick and choose and could subscriber to just the Sky channels for example the competition issue crops up again.

Losing a few digital channels wouldn't be a bad thing at all though - I'm sure the exampes he cites such as MTV would be absolutely fine, but for lesser channels that might struggle, would they really be missed?

It's more complex than that. I pay Sky full whack, but I don't watch football. I do watch other sports though like golf and cricket, which many football fans don't.

I'm also one of the 20,000 or so who watch operas on Sky Arts. We know from history that Sky Arts couldn't survive as a stand alone channel, so it is now subsidised from the subs of people who don't watch it. Fair enough, I'm paying for their football.

I just see my Sky sub as the licence fee. We all pay it but we all watch different programmes. If we end end up only paying for what we want, we'll just have wall to wall EastEnders, Strictly Come Dancing and The One Show (programmes I never watch) and all minority programming will disappear.

If there was a single distribution point I'd agree with your idea, but there's a multiplicity of distribution now, so why should a channel that's not available on my platform have influence on the charging of one that I want to watch on it.